Press Release - Machine-to-machine will transform the automotive sector, and generate revenue of USD282 billion by 2022

11 November 2013

As well as creating lots of opportunities for the sale of new products and services, M2M promises to have a substantial impact on how the automotive sector does business, stimulating a fundamental change in the relationship between driver and car.

The global connected car opportunity will amount to USD282 billion in 2022, on the back of 1.5 billion M2M connections in the sector. This will be a combination of factory-fit Vehicle Platforms (such as GM’s OnStar or BMW Connected Drive), accounting for 36% of connections in 2022, and aftermarket application-specific devices that account for the remainder. Of the USD282 billion, USD32 billion will be accounted for by devices, USD20 billion by connectivity and USD231 billion by what Machina Research refers to as the ‘Service Wrap’, i.e. the applications and services that make use of the M2M connectivity.

Those are some of the key findings of a major new study unveiled by Machina Research today entitled “Machine-to-Machine (M2M) Communication in the Automotive Sector 2012-22”.  Commenting on the findings, author Matt Hatton said: “Automotive continues to be the most interesting sector in M2M. The revenue opportunity is vast and, more interestingly, M2M connectivity promises to have a fundamental impact on the sector itself. While M2M in automotive today might be focused on enriching existing applications such as navigation or insurance, in the future the addition of connectivity promises to encourage radical new business models for car use and ownership“.

The addition of so much connectivity promises to have a transformational effect on the automotive sector. For instance, there is increasing evidence that automotive OEMs will need to shift from selling hardware to acting as an integrated ‘transportation service provider’. At the same time they have the opportunity to build a much closer direct relationship with the driver than they have generally had before. Both of these are very different from the hardware-oriented model of today.

There are some significant challenges associated with realising the opportunity and benefits. Hatton puts it thus: “There is something of clash of cultures occurring in the connected car space. The heritage of auto manufacturers (OEMs) is very different from that of mobile network operators, but both have much to learn from the other. MNOs have to provide robust global solutions that meet the needs of the OEMs, for instance through providing local IMSIs. OEMs are still afraid of the open application development ecosystem, an issue that MNOs resolved many years ago.

This press release is available to download as a PDF.

About the report

The report “Machine-to-Machine (M2M) Communication in the Automotive Sector 2012-22” is one in a series of Sector Reports published by Machina Research. It is based on detailed and exhaustive discussions with key relevant stakeholders, supplemented by Machina Research’s extensive understanding of the changing dynamics of the industry.

This report provides invaluable qualitative and quantitative analysis of the emerging opportunity for machine-to-machine communications in cars, motorcycles and other road vehicles. The report reviews the major drivers and barriers for growth of M2M in the sector and analyses the key market dynamics, including how MNOs, service providers and vendors might go about identifying and realising addressable opportunities. Each application is examined individually with case studies and forecast analysis. Ten application groups are examined:

  • Vehicle Platforms
  • Security & Tracking
  • Emergency Assistance
  • Vehicle Recovery/Roadside Assistance
  • Entertainment & Internet Access
  • Navigation
  • Voice
  • Insurance
  • Lease, rental, HP and share car management
  • Manufacturer Data

The forecast Data Sheet includes very granular 10 year market forecasts for 6 regions (country level forecasts are available through the Machina Research Forecast Database). The forecast covers numbers of connections, traffic and revenue for each of the identified automotive application groups with splits by technology (2G, 3G and 4G) and a detailed break-out of the revenue opportunity.

The report is available as part of the Machina Research Advisory Service.

About Machina Research

Machina Research is a technology research and consulting firm focused on the emerging opportunities associated with new forms of connected device. We provide market intelligence and strategic insight to help our clients maximise opportunities from these rapidly emerging markets. If your company is a mobile network operator, device vendor, infrastructure vendor, service provider or potential end user in the M2M, IoT, Big Data or mobile broadband space, we can help. 


For further comments or more information on this press release, please contact: Matt Hatton

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